Quote:
Originally Posted by MalcolmTucker
They are not growing at our rate, so a reasonable part of the growth can be absorbed through slack capacity. Alberta used up its slack a while ago. There has been huge population growth!
A higher cost base for capital investment due to way more capital investment in the province per capita. The need for more capital investment due to growth.
Higher dollar amount for staff to have a similar standard of living, so to be competitive you need to be competitive. In addition for some staff there is a need for higher salaries for retention. Due to pattern bargaining it applies to the wider bargaining unit. Due to growth retention was even more important.
Alberta also suffers from Noah's Ark syndrome. Everything Edmonton has Calgary needs and vice versa, so Alberta suffers from a much worse economy of scale than elsewhere for specialized facilities.
For somethings it is just the simple fact that Alberta is isolated, and we provide a very high level of services to smaller communities through a huge amount of paved highways and hospitals.
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Cost of living in AB is lower than that in ON and BC, primarily due to lower priced real estate, so that is a red herring. Directionally, the non tax component costs of living are likely headed lower in the province.
Higher population growth justifies higher capital spending per capita, but not higher operational spending. Given the current its current economic is state, AB can likely build infrastructure at far lower costs than in most other provinces because of slack in the construction industry.
Most government positions do not compete with the private sector, so retention is only an issue against other provinces.